Question 4

The following is the information of High-tech Company for the year ended 31 December 2006:

	RM
Administrative salaries	2,400
Advertising expense	1,200
Utilities costs	3,500
Depreciation expense	4,800
Direct labor cost	?
Beginning raw materials inventory	2,100
Ending raw materials inventory	3,200
Beginning finished goods inventory	46,980
Ending finished goods inventory	44,410
Administration insurance expense	2,240
Indirect labor cost	15,700
Factory insurance expense	3,400
Purchases of raw materials	14,600
Factory repair and maintenance	3,900
Marketing and selling salaries	2,000
Tax on factory	4,440
Sales commissions	1,410
Beginning work in process inventory	1,670
Ending work in process inventory	1,110

Additional information:

1. 80% of the utilities costs apply to factory operations; the remaining amounts apply to selling and administrative activities.

2. 70% of the depreciation expense is for the factory equipment; 30% is for the office equipment.

3. Direct labor cost is 40% of conversion cost.

REQUIRED:

(a) Prepare a schedule of cost of goods manufactured for the year ended 31 December 2006.

(b) Calculate the cost of goods sold for the year ended 31 December 2006.